Instead, execs told him his app competes with the new Facebook App Center, and they wanted to buy his company.

"I quickly became skeptical and explained that I was not interested in an acqui-hire," Caldwell wrote. "I had zero interest in seeing my product shut down and joining Facebook. I told your team I would rather reboot my company than go down that route."

Facebook did not respond to a request for comment.

While it's another embarrassing hit to Facebook this week, Dan Olds, an analyst with The Gabriel Consulting Group, said he's not surprised at Facebook using a strong business strategy.

"To me, it sounds like both Caldwell and Facebook are working on very similar services and, understandably, Facebook is going to pursue their version of it rather than bless and support Caldwell's version," he added. "While it's not a good result for Caldwell, it's how business works. Sometimes you win. Sometimes you lose."